By Marianne Stigset Oct. 21 (Bloomberg) -- Gold declined to near a one-month low in London as the dollar gained against the euro and stocks rose, reducing the appeal of the metal as an alternative investment. Stock indexes in Europe and Asia rose for a third day and the dollar climbed to an 18-month high against the euro as the U.S. moved toward a second stimulus package to buoy the economy. ``We're seeing increasing stability in the equities markets,'' Bayram Dincer, a commodity research analyst at Dresdner Bank, said by phone from Zurich. ``The fear is coming down. The volatility indexes are coming down, and that eases the upside pressure on gold.'' Gold for immediate delivery fell $15.16, or 1.9 percent, to $781.74 an ounce by 11:10 a.m. in London. Futures for December slipped $6.70, or 0.9 percent, to $783.30 in electronic trading on the Comex division of the New York Mercantile Exchange. ``The gold bulls are out of the market for the time being,'' Dincer said. ``Liquidation by the hedge funds in New York will continue this week.'' Bullion will probably fall further as weakening crude oil prices reduce the appeal of commodities as an inflation hedge. Gold fell to $781 an ounce in the morning ``fixing'' in London, used by some mining companies to sell production, from $795 at the previous afternoon fixing. Among other metals for immediate delivery, silver gained 4 cents, or 0.4 percent, to $9.82 an ounce, platinum fell 10 cents to $898.40 an ounce and palladium slipped $2.25, or 1.2 percent, $180.75 an ounce. Platinum rose to $887 an ounce in the morning fixing in London from $877 at the previous afternoon fixing. Palladium was unchanged at $182. To contact the reporter on this story: Marianne Stigset in Oslo at mstigset@bloomberg.net

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